Why and how to do business with the Federal Government
4 reasons why you should do business with the federal government
Spending power : The federal government is the world’s largest buyer of products and services. In 2018 alone, they have spent more than $834 billion dollars in contractual services and supplies. And, that’s not even accounting grants, which is a whole new subject for some other day.
Consistent Spending : As business owners or executives, one of our biggest fear is uncertainty. Unlike, in the private sector, federal government spending is certain, regardless of the macroeconomic environment.
Payments : The risk of not getting paid after delivering services or products in the private sector is part of life. The government on the other hand, pays consistently on time and normally has a net 30 day term.
Location : No matter where you are located, there’s opportunity for you ! Federal government, State and local governmental entities are everywhere.
There is a reason why gigantic companies like Amazon, IBM, Deloitte and many more are selling to the government.
Now that you know why, here’s how in 12 steps :
Step 1 : Identify your NAICS code(s).
What is a NAICS code ?
The North American Industry Classification System (NAICS) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy.
Step 2 : Do your market research on your clients — Federal Government.
Determine if the federal government purchase what you sell. A quick and easy way to do so is by accessing the FPDS — Federal Procurement Data System.
Step 3 : Obtain a Duns number.
This is a business identification number that is used similar to your social security number.
Step 4 : Register in the System for Award Management (SAM) and get a CAGE code.
You must be registered in SAM to be awarded a contract from any federal civilian or military agency.
CAGE = Commercial And Government Entity Code
Step 5 : Determines if your firm qualifies for any SBA contracting program.
SBA has a variety of programs aim to help small businesses successes. For more information, please click here.
Step 6 : Familiarize yourself with the contracting legal procedures.
The Federal Acquisition Regulations (FAR) and the Defense Federal Acquisition Regulation Supplement (DFARS) are the two main legal regulations for federal acquisitions.
Step 7 : Investigate if getting on the GSA Schedule is right for you
Federal agencies have many ways of making a purchase. One of the most common way is through a GSA schedule contract. The GSA Schedule is a $45 billion government contract. Businesses, non-profit organizations, and educational institutions can obtain a GSA Schedule Contract to sell products and services to government customers. Click here to see a list of GSA Schedules.
Step 8 : Familiarize yourself with the forecasts for your targeted agencies
Each federal agency typically produces an Annual Procurement Forecast as required by the Small Business Act, which is maintained by their Office of Small and Disadvantaged Business Utilization (OSDBU). Familiarize it, and market to the right agency.
Step 9 : Explore subcontracting opportunities
Sub-contracting is one of the easiest way to get your feet wet. There is a very large secondary market — subcontracting opportunities through prime contractors. Although there is no single point of entry for subcontracting opportunities in the federal civilian procurement marketplace, SBA is a valuable source for obtaining information on subcontracting opportunities.
Step 10 : Investigate government programs
There are several SBA programs that may be of interest to you, such as the 8(a) Business Development Mentor-Protégé Program, the Small Business Innovation Research Program, Small Business Technology Transfer Research Program and the Technology Resources Network. There are more information on this topic over here.
Step 11 : Market your firm to the right contacts
Identify your prospective government customers, research their requirements, and familiarize yourself with the procurement regulations and strategies. There are many procuring organizations to consider, and educating yourself about their roles and missions will be no small task.
Step 12 : Find vendors to bid on a contract together
This step is crucial, especially for firms that just got started. Finding the right partner requires a lot of work. However, these work will pay dividends as your proposal will be significantly stronger and therefore increases the chance of winning a contract.
David is a serial entrepreneur and an adviser in mobile, blockchain, digital marketing, AI and real estate related business. He is currently the managing director for Kroleo where he develops strategy, business developments and directs financial operations for the company.Prior to Kroleo, he also co-founded Veltrust — a boutique consulting firm that provides intuitive guidance in developing the best use cases of cutting edge technologies in the emerging market and also specialize in international fundraising for early stage start ups.
Please feel free to reach out to me for any questions or opportunities of teaming up. I will try my very best to help as much as I can. 😃
